Also known as: trust deed · deed of trust · deeds of trust
Written by attorneys · grounded in primary & secondary sources — see below
A security device by which title to real property is conveyed to a trustee to hold for the benefit of a lender until the debt is paid. The borrower retains possession and the right to redeem. Upon default the lender may foreclose to satisfy the obligation.
Tyrone Tran borrowed funds from TechVista Solutions to develop vacant land and executed a deed of trust naming a trustee to hold title until repayment. When Tyrone defaulted on the note, TechVista directed the trustee to initiate foreclosure proceedings. The sale proceeds satisfied the debt and terminated Tyrone's equity of redemption.
Tabitha Taylor granted a deed of trust containing power-of-sale language to True North Logistics to secure a commercial loan. After Tabitha missed payments, True North instructed the trustee to conduct a nonjudicial sale. The trustee provided statutory notice, sold the property, and applied proceeds first to the senior debt.
Select any source to read its text and confirm it supports the definition.
Talia Torres executed a deed of trust in favor of Trailblazer Airlines that recited it secured both an initial loan and any future advances the airline might make. After the airline later extended additional credit for equipment, Talia defaulted on both obligations. The airline claimed the later advance enjoyed the same priority as the original loan under the dragnet clause.
Tanya Tang's late husband had placed the family residence into a deed of trust for the benefit of a lender. After his death Tanya elected her statutory share and sought to include the trust assets in the probate estate. The court examined whether the deed of trust arrangement removed the property from the reach of the elective share.
Tessa Takahashi and her co-owner held property in joint tenancy. Tessa unilaterally executed a deed of trust on her interest to secure a personal loan. Upon Tessa's death the surviving joint tenant claimed the entire property free of the encumbrance created by the deed of trust.
Tara Tran and her joint tenant leased part of the property while a deed of trust encumbered one cotenant's interest. When the encumbered cotenant died the surviving joint tenant asserted that the lease terminated along with the encumbered interest. The court analyzed whether the deed of trust altered the survivorship consequences.
Yes. A deed of trust is a security device that cannot exist without a valid debt or other obligation. When no loan is funded and no note is executed, the instrument lacks the necessary debt and is unenforceable against the property or later lienholders.
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A future-advance or dragnet clause can secure subsequent advances by the same lender. Priority of those advances depends on state statute, the mortgage terms, and whether the advance occurred before notice of intervening liens.
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A power-of-sale clause authorizes nonjudicial foreclosure under the deed of trust and applicable state statute. The lender may direct the trustee to sell the property without court action, subject to statutory notice and redemption rules.
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A contemporaneous side letter may raise factual questions about the parties' intent, but the formal mortgage or deed of trust document that pledges the real property as collateral ordinarily creates an enforceable security interest. Courts examine whether the writings together modify the usual foreclosure remedies.
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…expired with it.” (Accord, Hamel v. Gootkin (1962) 202 Cal.App.2d 27 [20 Cal.Rptr. 372] (applying the Nogarr holding to a trust deed).) As these decisions demonstrate, a joint tenant may, during his lifetime, grant certain rights in the joint property without severing the tenancy. But when such a joint tenant dies his…